Evolent Health, Inc. (EVH) Earnings Call Transcript & Summary

Good afternoon, everyone. Welcome to the JPMorgan Healthcare Conference. My name is Annie Samuel, and I'm the health care technology and distribution analyst here at JPMorgan. We're very excited to have Evolent here with us today. With us are CEO, Seth Blackley; and CFO, John Johnson. We're going to have them do their presentation. And following that, we're going to do an interactive Q&A session. So if you have a question, please use the blue ask a question button in the portal, and we'll be sure to take questions from the audience. So with that, let me turn it over to Seth.

Thank you, Annie, and welcome to the Evolent presentation. Sorry, we're not all cramped into the Westin St. Francis together, but we'll have together nonetheless. As Annie said, I'm Seth Blackley, CEO and Co-Founder. I'm joined by John Johnson, our CFO. The agenda for the presentation is shown here, and I'll cover the first 3 topics, and John will cover with the -- close with the financial model and outlook. So if you flip into Page 3, for those of you who are new to Evolent, we're a leader in the value-based health care segment. In many ways, the first value-based health care public company. Decade into founding the company, we're a fast-growing profitable technology-enabled services company. As we'll talk about today, we believe we have a large addressable market, which has fueled an average annual adjusted growth rate over the last 3 years of over 30%. We're approaching about $1 billion in revenue derived from the 3 businesses shown here. New Century Health, which is part of the Clinical segment where we manage the fast-growing specialty costs of oncology, cardiology and end of life. Second, Evolent Care Partners, which is also in our clinical segment, where we manage the primary care spend through a risk model. And then third is Evolent Health Services, which is our administrative segment, where we support New Century Health and Evolent Care Partners, but we also vend out those same tools to the market as a software and services business. As illustrated in the slides, our revenue margins are increasingly from our Clinical segment, which has been growing north of 50%. And so that's where we'll spend most of our time and comments today. All right. So flipping to Page 4, as an early technology company and pioneer in driving the value equation in health care, our mission has been to change the way health care is delivered and in doing so, reduce $1 trillion of waste in the U.S. health care market and improve patient quality. We do that by providing our services to health plans and to providers, and we'll talk about how we do that today. Flipping into Page 5. When we started Evolent, it was fundamentally to bridge the divide that exists between payers and providers. Typically, providers want the cost of care to be higher. Payers want it to be lower. And the patient is often caught in the middle. Our value-based care platform is serving to bridge the divide for specialty costs through New Century Health, Primary Care, spend and care through Evolent Care Partners and in the administrative and back office side through Evolent Health Services. In the process, we've been able to consistently improve quality, reduce payer costs and improve the compensation for the physicians that we work with. And we're serving a long list of customers, some of whom are listed here. And for them and us and our 3,500 fantastic employees underlying all this is the mission that I mentioned, that's why we come to work every day. Turning to Page 6. We get asked a lot where we fit into the broader technology and services, health care landscape and ecosystem. Remember that most of what we're doing comes from the fundamental shift that's underway from traditional fee-for-service where financial rewards go to those who drive volume and counters, but where participants are not really held accountable for outcomes. We believe this fee-for-service model medicine is simply not sustainable. So who are our customers? We have 2 types of customers. On the payer side, we have 2 types of payers, traditional payers like Humana and newer payers like a Bright. And on the provider side, we have independent groups like a South Bend Clinic that we showed previously or a risk-bearing group like Oak Street. In the middle, we do collaborate with a number of industry participants like those shown here. And then third, on competition, we actually don't have competition in roughly 50% of our new customer sales pursuits due to the uniqueness of our products. So a lot of our growth comes from proprietary sales pursuits. But you can see on the right, some of the sorts of organizations we might compete with the other half of the time. Okay. So flipping to Page 7, why Evolent. I want to turn now to talk about our 3 investment themes listed here. Turning to Page 8. The first theme is growth. We are a growth company in growth markets. Our 3-year CAGR is over 30%, as I said. We're very proud of that and feel like we have many years ahead of strong organic growth. Our revenue is recurring, have strong visibility and that comes from both new customers and new logos and existing customers. And in fact, we're getting roughly 40% of our growth, as you can see here, from existing customers and they're renewing at a rate of 110% on average on a dollar basis on average since 2019. So flipping into Page 9. Maybe the most important message I want to share with you today is that we are in the early days of a very significant cross-sell opportunity in the market. To explain this significant opportunity with our existing customers, I wanted to highlight 2 new blinded examples. First, on the New Century Health front, we've talked a lot about the large opportunity for growth within our existing customers, either through lives that we don't touch today or through the conversion of our tech services lives. Here you can see an example on the left of that happening with one national payer where we've had modest revenue in the past, the left bars are from 2020 and 2021, where we just had the tech services piece in place. And we have had great performance with that partner. And now that client for 2022 has $75 million of revenue contracted through the New Century Health Performance Suite. Importantly, we're less than 10% penetrated with this payer client in '22. So getting to 25% penetration would be $200 million in annual revenue. Second, on the right, you can see a similar story has played out with Evolent Care Partners. In this example, which is a state in the Southeastern U.S., we and our primary care partners had only CMS revenue through the Medicare Shared Savings Program. We've been talking about the path to moving to full capitation for a while. As you know, for those of you unfamiliar with this difference, it's really the difference between revenue from CMS which is just a portion of the savings, full capitation, the revenue is a lump sum per patient fee covering all the health care costs for that patient. And I'm obviously pleased today to announce that we've entered into our first primary care capitation contract in this market. It will generate over $50 million of revenue for us this year. This is an important proof case for us in expanding Evolent Care Partners because we know this population and these physicians quite well. We're also pretty excited about the margin ramp. And while we're excited about the capitation model, we're generally taking a very disciplined and prudent path to making sure anything we do in this area is EBITDA positive. All right. So if you look at Evolent on Page 9, one of the most important opportunities, I think, is that we're in the very early innings the same-store growth opportunity. And at the bottom, if you look at NCH alone, getting to that same 25% penetration for our top 5 customers is a $4 billion annual revenue opportunity. So very, very significant. This is not a pie in the sky TAM analysis, just the real opportunity, as you can see on this page really is beginning to happen now. Turning to Page 10. John will explain our financial model in detail, but I want you to understand that we are up to a 6% adjusted EBITDA margin now, and we do have a clear path towards the mid-teens EBITDA margins that we've been talking about through mix shift, scale, et cetera. All right. Page 11. Finally, we are thoughtful regarding efficient capital allocation and we certainly are generating operating cash today and going forward. We have a lean CapEx model. We have a lot of cash on hand, and we have low leverage. I think this provides us flexibility that we view as a differentiator at a moment of rapid change and growth in our segment. So on the M&A front, I'd say we're going to be focused and disciplined, but we will look for more opportunities that are certainly accretive financially immediately and accretive strategically. I think the Vital Decisions acquisition last year is a great example and a great template for us. The deal is going quite well, and we see some other opportunities like in the future, mostly again around the New Century Health platform. Before I turn it to John, I just want to go a little bit deeper on our solutions. If you turn to Page 13, I want to start with our Clinical segment, New Century Health, Evolent Care Partners, given that this segment has been growing, as I mentioned, at over 50%. If you think about New Century and Evolent Care Partners, we're doing 4 fundamental things that I think of as air traffic control of value-based care. In our case, we aggregate and analyze data, and we pinpoint with a lot of accuracy the protocols that should guide the care team how to consistently treat patients to ensure they're safe and they're treated efficiently as possible. So we are working behind the scenes to enhance communication flow, transparency and provide that clinical guidance. Let me give you an example of how New Century Evolent Care Partners capabilities are used in one market where we're managing about 100,000 patients. On this slide, you can see 4 things. First, we start with data aggregation. We use our big data factory to aggregate that clinical data for those 100,000 patients in this example. Second, on the wheel, we use our proprietary predictive models to identify which subset of patients need interventions. So in this example, there might be 20,000 to 100,000 patients that really benefit from intervention. Our system, the air traffic control system, will identify those 20,000 patients, and it will automatically queue up the optimal care plan for those patients. So this is really the brains of the air traffic control system. It's based on actuarial science, machine learning and a big clinical R&D team that we have here at Evolent. Third, we intervene with as many of these 20,000 patients in this example as we can. This is the part of the process where we really fly the planes. To use that example, our nurses and doctors engage with the patients directly on the optimal plan or with the treating physician to ensure that the patients are receiving best care. And then finally, we do close the loop, the fourth piece on the back end. We do actually pay the doctors in many cases for their work. We pay the claims. We write the checks. We like writing the checks to the physicians. That's how you bonus a physician until you reinforce the incentives for the right high-quality, low-cost care. So that gives you a flavor of how it works. On 14. You can see how that translates to outcomes on the top of New Century, 7% to 10% savings in year 1, over 20% savings in the long term. If you're a payer that's spending $2 billion in cancer care and think about 20% savings over time, obviously $400 million of operating income, it's a huge deal. These are big numbers. And it's the reason I think we're experiencing the growth we are. For Evolent Care Partners, we had a great year last year. 7 to 1 ROI, as we illustrate here in the average physician in our network made an extra $25,000 of income by working with us. On Page 15, I want to go a little bit deeper on NCH and a cancer example. A lot of people ask us for give me a little more detail one click down. So here's how it works on this page. Let's imagine you're in that market with 100,000 patients. Of those 100,000 patients, there might be 2,000 who are diagnosed with cancer in any given year. Unfortunately, today, probably 35% of those 2,000 patients would receive a diagnosis or a course of care that's not optimal. So let's call that a level 1 pathway rate of 65%. Our job is to increase that 65%. So how do we do that? On the left-hand side of the page, we spend a lot of time each year developing and maintaining the Level 1 precision pathways. We have a team of clinical R&D researchers. We have 15 years of data. We have our Scientific Advisory Board realizing that these protocols are changing every month with hundreds of new journal articles coming out. Our job is to ingest that information, interpret the science, including the genomic data and the fine slicing of cohorts so that we're armed with the best pathways information in the market. So with that, let's move to the middle of the page, and you can imagine now how we might apply those pathways to those 2,000 patients diagnosed with cancer. Our system reviews all 2,000 cases. It flags cases where the care proposed by the oncologist differs from best practice so where they're not at Level 1 pathway. Let's assume in this example in the middle that 1 of those 2,000 patients is a 50-year-old with lung cancer. As you can see, there's up to 9 therapeutic alternatives for that patient with that age and that genetic profile. Our system would window those alternatives down to the 2 that we think have the best quality, lowest toxicity, most reasonable cost profile. And if the treated oncologist is not using one of those alternatives, we intervene using our technology, through the practice or ultimately maybe one of our oncologists to do a peer-to-peer outreach to the treated oncologists. And we have great success in getting changes to the wrong treatment plans. Our Level 1 pathway here will go from, say, 65% when we start working with the population to over 80% within a year. As you can see on the right of this page, a dramatic cost savings. Of course, quality benefits when that happens. And in some cases, we're increasing the cost of care. But even net of those situations, we tend to drive down cost a lot. On Page 16, you can see the macro impact of doing that thousands of times across lots of markets in this 1 small payer example. $79 million of savings over 5 years. It's a real example. It's big in year 1, but it gets bigger year-over-year, as you can see because of trend. And this is really how we guarantee savings and why New Century and the clinical segment more broadly is growing so quickly. Page 17 briefly, let's move to our second solution, Evolent Care Partners. You can see here, if you're familiar with risk-based primary care, you're familiar with this model. We operate in 9 markets, $1 billion in premium. We drive savings. We share that with the physicians and share some with CMS and keep the rest. And then Page 18, Evolent Health Services. In interest of time, I'm going to move quickly here, but this is our third solution. We've ended out on a fee basis in addition to supporting our own solutions. This has been a steady contributor for us and has a very strong outlook going forward. So with that, I'll flip it to John.

Thanks, Seth. And with the time that we have remaining before we flip it back to Q&A, I'd like to just hit on how we get paid and how we drive margin both today and margin expansion into the future. So if you flip into Page 20 in the deck, we monetize our products and services in 2 ways. The first is through recurring service fees, and we're paid a per member per month fee for a particular scope of services. Here, we drive margin through scale, product differentiation and pricing power and by participating in shared savings that we create with our partners. The second way that we monetize our services is through capitation where a health plan partner will transfer the responsibility for a scope of medical costs to Evolent. And we will drive our margin by capturing the clinical savings that we create from that capitation rate, which is, again, a fixed monthly fee per member per month. Historically, most of our capitation arrangements have been in New Century focused on specialty care management for oncology and/or cardiology, where an average scope fee might be around $30 per member per month. As Seth mentioned earlier in the presentation, this year, we are deliberately moving into primary care capitation with Evolent Care Partners, where we expect a total cost of care cap rate of around 600 plus for this first year. Flipping to Page 21. Seth highlighted some of our key growth drivers. The thing that I'll highlight on this page is just the last 11 quarters of growth here continued strong performance growth above 30% a year for a number of years now. If you flip to Page 22, we are currently driving an EBITDA margin of about 6.5% across our enterprise. And we have 3 identified levers to drive that into the mid-teens by 2024, which is the target that we've set. The first is through identified cost reductions. Think things like automation and specific projects that are underway to capture those sorts of opportunities. The second is SG&A scale, simple leverage as we grow. The third is the clinical maturation curve of our capitation customers largely. So as I mentioned, the way that we drive margin in a capitation deal is by capturing that clinical savings that we create. Typically, in an arrangement like this, those savings accumulate over the first few years. So for example, what you see on the page here, the first year, a New Century Performance suite contract in specialty management might create savings that we keep, of course the customer keeps them as well. Savings that we keep of between 4% and 6%. Then in the next year, we might double that. And then the third year, we might reach our medium-term to steady-state target margin in the mid- to high teens. Now of course, this does mean that the faster we grow our capitation book, the more of that first year margin that we have, which impacts on our year-to-year margin expansion while at the same time, maximizing our long-term EBITDA dollar opportunity, which ultimately is a key focus for the enterprise. Turning to Page 23. We've outlined 3 core capital allocation priorities. First, continuing to invest in the business and services that we have. We spent about $45 million in R&D last year, inclusive of software development. That will continue to be an important place of focus. Second, disciplined M&A, as Seth mentioned earlier; and third, approaching those goals in the context of an efficient balance sheet with a reasonable leverage ratio, reasonable cash interest and so on. Finally, and then I think we'll open it up for questions, Page 24, just a quick summary of our '21 outlook and starting to look ahead to '22. For '21, we're reiterating our top line guidance and updating our bottom line to now expect to meet or exceed the high end of our EBITDA range for '21 based on continued strong performance. As we look into '22, we'll give formal guidance in February. But based on the strong performance that we had in business development across '21 with the most number of new partners ever signed in the company's history and strong renewal environments, we are anticipating now clearing our target mid-teens growth rate being in excess of that for '22 as well as continuing to expect expansion in our adjusted EBITDA margin from our most recent quarter. So with that, I'll just reiterate, on Page 25, 3 core themes here that we think about every day: driving shareholder value; our compelling organic growth opportunity, both our historical performance and the opportunity into the future; strong and expanding margins, translating to real cash flow and doing that with an efficient balance sheet. So Annie, back to you.

Great. Thanks so much, Seth and John for that. Great presentation. This feels like it's been the year of value-based care, but it's a space you've been in long before others. And I was hoping you could discuss a little bit about what the appetite is like for value-based care. And what's really driving that acceleration?

Yes. Good question, Annie. I think it's a couple of things. One, the biggest driver is that it works. And I think the payer community are looking for ways to drive down their medical loss ratios and they have their own pressures to deal with. And so I think it works and it really does eliminate savings in ways that maybe traditional methodologies of utilization management or denials or things like that are just much less efficacious in making the savings a reality. And so because it works and we now have enough data to go back to the payer community or even the risk-bearing providers and say, hey, here it is. It has worked. We're getting more and more engagement around it. So I think that's the biggest thing. I think the second thing is there is a growing drive in the provider community, Annie, like exhaustion with UM and denials and the old models of managing costs, and that is even making its way up through legislative changes, CMS changes and the like. So that's the second thing. And the third thing, I think the policy lever and the CMS drive towards, hey, we want everybody to be in a risk model by 20 -- whatever they said '28 or 2030, that's helping. To be honest. I think that's the third of the 3. I think the bigger ones are the payers and the providers want it to happen.

That's really helpful. And something maybe we could talk about the guidance update you provided today. It's really strong. You're saying that you think that you can do above mid-teens revenue growth next year. We know that you've had really strong growth in new partnerships, but I was hoping maybe you could talk a little bit about same-store growth, maybe provide a little bit of color there because that's also a big driver of your revenue growth.

Yes, absolutely. Historically, as you know, Annie, that's been about 40% of our average annual growth has come from same store. And it's been a really strong renewal year for us as we come into this year and that includes both same-store expansion. As Seth outlined in the presentation where we had a partner going from $7 million to $10 million in '21 now with contracted visibility into $75 million in '22. So a really strong renewal environment, pretty consistent with prior years.

That's great. And then as we think about that incremental revenue above your kind of run rate target, how do we think about how that flows through to your EBITDA?

Yes. It's a great question. So most of that fast growth, as you sort of heard us mention throughout the presentation, is in the Clinical Solutions segment and is in various forms of capitation. So those are going to be the kind of arrangements that start with those first year margins that I was talking about. So positive. We drive the way we contract for risk as we drive profits in year 1 but lower than the ultimate run rate. So the margin profile that you see on Page 22 in the deck is sort of how you might think about that excess growth in 2022.

Great. And I'm going to take some questions from the audience. The first one, I think you answered this one a little bit, but you might maybe want to provide a little bit more color. What is the expected margin for the new ECP full capitation contract?

Yes. So I think directionally, we would expect that to track over time our average performance suite targets, which are there on Page 22. So a reasonably small first year flow-through contribution, getting up into the teens on a stable basis.

Great. And then the next one from the audience is 20% to 25% of health care dollars have been administrative costs. What is your overall strategy on that? And then the second question, it's a 2-parter is, what would you do when payer providers disagree on significant issues?

Yes. So I think it's interesting that the first question, I'll take first. That's right. A lot of that $1 trillion of waste is actually administrative waste and actually the largest chunk of the waste is administrative. So it's kind of an interesting maybe nonintuitive piece of information that I think isn't widely out there, but we think of that waste opportunity and things like revenue cycle on the provider side and the denial on claim payment on the payer side as a form of value-based care is often linked, Annie, to that question to clinical disagreements to the second question of, hey, you shouldn't have done that or you should have done it this way, which I think of as utilization management, denial management, all that stuff, right, and the disagreements that arise. And so in our minds, our Evolent Health Services unit is very relevant for this. We're doing everything we can to automate that process. But also across New Century and Evolent Care partners, as you increase the alignment between payers and providers around what is best care and you can get agreement on that through a Level 1 pathway or the like, you can, we think, avert not only the clinical costs but the administrative costs that come downstream. So in our minds, the 2 questions are very linked. The answer to the second question is more automation, but also it's getting alignment ahead of time on the right pathway to follow. And we and other companies like us, I think, play an important role in doing that. And when you run at the clinical waste, you then also run at the administrative way. So really good questions and a core part of how we're addressing the market.

That's great. And one question that we always get, and I think it's really helpful is, how do you compare to some of these other primary care models that are out in the marketplace?

Yes. So I think the biggest fork in the tree of the family of primary care models that are out there, there are a number that are employed, right? And let's use Oak Street as a great example. Fantastic company, doing great work on the employed side. We don't do that. We are in a different category, which, Annie, is the non-employed model, network model, let's call it. And so within that segment, there are only a handful of organizations running at the market in this way. We're not employing the physicians, and it's a -- has its pros and cons. One of the benefits is it's lighter capital and a little bit more efficient from that perspective. And in that market, we have slightly different ways that we target the market and our proposition is a little bit different. But the fundamental point, I think, is that a lot more of the market might be on the employed side, and we're on the sort of network and affiliation side.

Can you talk about why primary care is so important in terms of what you do? That primary care physician is really the quarterback of care. It seems to be the kind of the vein of value-based care. So why is that so important?

Yes. I mean I think the big thing, Annie, is that it's the whole primary care is 3% of health care cost, but controls 50%, 60%, 70% of the cost. So they are the best positioned to operate the air traffic control system to use the analogy I was using earlier because they have that bird's eye view and they have to trust the relationship with the patient to be able to help direct the CytoCare, direct the coordination of care, the referral pattern to the places where the cost actually is spent. And so that's why -- and that's why we started with primary care at Evolent. And we still think it's very core. Specialty, we think, is also hard. And the reason we've entered that as well is because even when a referral is made to an oncologist, once it's made, it is outside of the primary care office and the oncologist becomes the primary physician for cancer patients. So that's why PCPs are critical. And in our minds, why having both is important.

That's great. I'm going to take another question from the audience, which is what percent of your business is cardiology versus oncology?

Yes. Within New Century, it's about 35% is cardiology in terms of our revenue base versus the other 65% in oncology.

Great. And another really good one from the audience. What do you think is the most misunderstood aspect of Evolent and the long-term opportunity?

Good question. Where shall I begin? Honestly, I think the biggest, in our minds, piece that's not fully understood is the uniqueness of particularly the Clinical segment, right? And New Century Health and Evolent Care Partners, in particular, are very unique solutions that don't have a lot of competitors and are very -- are growing very quickly. And in our minds, either 1 of those 2 pieces on a stand-alone basis, if you think about one is a sum of parts valuation methodology, we think have tremendous value. So maybe the misunderstood part, Annie, could be that sort of the value locked up in that clinical segment is probably, in our minds, more significant than the market fully realizes.

That's great. I was hoping maybe you talk a little bit about New Century because that has been such a great acquisition for you, and you just discussed cardiology and oncology. But what are some other areas that you think you might be able to move into there? Where do you think that, that would really fit?

Yes. I'll start, and John may add a couple of other comments, too. So the end-of-life piece that we added last year was really big, Annie, think is a good example because end of life is 25% to 30% of all Medicare spending. The last 6, 9 months of life, 12 months of life and about 70% of that cost is actually cardiology and oncology. So the ability to add something that is another big cost spend area, it's unaddressed and it's highly correlated what we're already doing. That's sort of a very good fit in our minds. Other things that fit that category, Annie, imagine other specialty spending areas that have common characteristics to cardio-oncology maybe they have high implantable device costs or high costs associated with therapeutic or very complicated science that makes choosing the right course of care very complicated. Aduhelm is a new drug in the Alzheimer's space we all hear about, which is a really, really expensive, complicated decision-making process, et cetera. So I think anything, Annie, that fits well with that same thesis is a really nice way to dovetail with what we already have and kind of fits the DNA of what New Century is. Obviously, over time, any of the specialties, kidney, musculoskeletal down the list could be relevant as well. But I think we're first and foremost focused on things that are kind of close to home and take us deeper rather than broader.

That's great. Capital allocation has been something that's been kind of an evolution, I would say, for Evolent. Can you talk about what your capital allocation strategy looks like now? It seems like it's maybe more narrowly focused, and that opens up -- you up to maybe more opportunities for some more synergistic types of M&A versus in the past. So maybe you could just spend a little bit of time on that.

Yes, absolutely. So I think as we think of capital allocation, first and foremost, it is really important, we believe, to continue to invest in the solutions that we have. And so that 2.5% of revenue going towards software development, product development that's capitalized, we think, is an important place to continue to allocate capital. As you then think about M&A, I think the way that Seth described it is spot on. I would add one more from my seat, which is we do have a specific focus on accretive acquisitions on the EBITDA line, where given our financial profile today, we're cash flow positive and have an expanding margin trajectory. We're looking specifically for assets that would accelerate or sort of modestly expand the work that we're doing today, probably with a specific focus on New Century within the specialty management space, given what we feel is the depth and differentiation that we already have there and the size of that growing market.

That's great. Maybe in the last couple of minutes here, Seth and John, you could share with us what you're most excited for in 2022.

Other than the end of the pandemic, I think what I'm excited about, and I know John feels the same way is that we have these 3 solutions, Annie, that are highly differentiated and have a lot of running room ahead. And being able to realize the growth potential that we know is there and share that with the marketplace and enjoy that success with our team, which, to me, is just a more complicated way of, say, just executing and delivering on the organic growth and margin expansion that we've been talking about, I think, is exciting. I think second for me is this year is really a year of innovation for us from a product perspective within that disciplined mindset, whether it's with M&A organically. Because we have market leadership now, and we're so focused, we're able to put a lot of our cycles on innovation, I think extends our lead. So we're going to deliver, hopefully, really, really nicely against the objectives we have but then also extending our lead to set up '23 and '24, and it's really a big theme around innovation.

Yes, I would echo that. If you think about the journey that everyone's been on over the last 2 years, we really have been on this focus, focus, focus journey, where we're now at a point where we're generating cash flow. We're growing nicely and our products are seeing nice residence in the marketplace. And so I think continuing to execute on that vision is maybe it's not as exciting like brand new, but it's sort of really nice and exciting to me and to Seth and the rest of the team to sort of see that tangibly in front of us and continue to run at it.

I think that will be exciting for Evolent shareholders as well. Thank you guys so much for sharing your time with us today, it's a really great presentation. And thank you to everyone for joining this session today. Good luck with the rest of your conference.

Thank you, Annie. I appreciate it. Have a great day.